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education: What is Amortization? - 07/15/07 11:46 AM
This is a very interesting word. The word, "amort," comes from the Latin root, "mort,"
meaning death... Like in the word, "mortuary" or "mortality."
Every time you make a mortgage payment, your loan is amortized, and your debts get closer to its grave.
You track your payments nad diminishing debt on an amortization schedule.
A timetable that shows how each payment is applied to principle and interest, and the remaining balance on the loan.
… (0 comments)
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education: What is a Point - 07/15/07 11:23 AM
What is a Point?
A point is a fee that is one percent of the loan amount. Points may be charged as an origination fee, which is one of the ways the mortgage company gets paid for their services or as a discount point, which is paid to reduce the interest rate on a loan.
For a loan of $200,000 a point will be $2,000.
Points are negotiable. If a seller, offers closing cost help of $10,000 on a $200,000
Loan and the buyer only needs $8,000 to close, it would be wise for the buyer to use the additional $2,000 to pay a discount … (1 comments)
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education: Flipping is Back! - 07/09/07 09:50 PM
For years, the word flipping was construed as an act of evil. The press took the word, ran it into the ground, and gave flipping a horrendous burial. The mere mention of the word to some folks meant that you were a bad person taking advantage of innocent peoples. It is sad, how a few dishonest snake oil salesmen and misguided press can take something that for years was a fine and decent way to make a living into something foul.
Well those days are over, we as investors and real estate agents can rejoice. With the help of shows like Flip … (7 comments)
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education: Seller take-back mortgage - 07/03/07 05:11 PM
If you assume an existing low- interest mortgage, the balance on the mortgage will usually be far less than the purchase price of the house. This means you must come up with a very large down payment unless you can get the owner to finance part of the difference.
Sometimes sellers are willing to take back a second mortgage at a below-market interest rate. I have done this on occasion with my own properties. For example: Selling price of home is $350,000 owner owes $225,000 the seller has $175,000 in equity. You make a full price offer but can only get … (0 comments)
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education: Types of Insured Mortgages - 07/02/07 02:26 PM
Previously I said it was two types of insured mortgages, but actually, there are two main sources to which to obtain insured mortgages and one not so popular source, which are gained through FmHA.
Having private mortgage insurance is one of the conditions and obtaining a mortgage with a low down payment. The cost of private mortgage is added to your monthly mortgage payments.
There are several programs that you can obtain mortgage insurance.
FHA (Federal Housing Administration) mortgage insurance programs.Farmer Home Administration (FmHA) loan guarantee program.Veterans Administration (VA)) loan guarantee program.
The government insures FHA and VA loans. To obtain either FHA or VA … (0 comments)
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education: Mortgage Insurance - 07/01/07 12:41 PM
It is universal that the lower the down payment, the more money you need to borrow and the more money you put down the less you need to borrow. Mortgage with less money down typically need to have mortgage insurance, usually loans less than 20% down.
Mortgage insurance benefits the lender, not the buyer. Mortgage insurance is a separate insurance; it is not a life or hazard insurance. It covers the lender in case of foreclosure. Mortgages obtained with little or no money down lenders, take a much bigger risk of losing money. Claims for mortgage insurance are not paid to the … (0 comments)
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education: Difference between Mortgage Note & Mortgage? - 07/01/07 12:21 PM
What is a Mortgage Note & Mortgage?
The mortgage note is the document that spells out the terms and condition of the loan. This document is a promise to repay the loan. The mortgage note sometimes called a promissory note. The note goes into details of the loan such as monthly payment, number of payments, amount due, and interest type.
The mortgage itself is a separate document, which you sign at closing. It states that the home itself is security for the loan. Some states sign a deed of trust instead of a mortgage... they both serve the same purpose.
Until next time
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education: Weatherization Assitance Program - 06/28/07 11:20 AM
There are many wonderful grant programs;
here is one of many programs that I think is well worth mentioning.
Weatherization Assistance Program (WAP)
The program helps eligible low-income households through the installation of energy conservation materials in their dwelling units. These measures both reduce the consumption of energy and the cost of maintenance for these homes. Priority is given to homeowners who may be elderly, disabled, have families with children, and/or have the highest energy consumption. Eligible renters may apply and will be given due consideration in accordance with the Weatherization Assistance Program's Rental Property Investment Program.
Who is Eligible to … (0 comments)
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education: When Divorce and Real Estate Collide - 06/27/07 06:12 PM
When You Sell because of Divorce
If you and your spouse decide to sell your home, it will be important to work together through a professional to maximize your return. Differences aside, you both should be present when a listing contract is put together. Both of you should understand and sign this contract, and both should be active in the ultimate negotiations. By working together, you can maximize your equity; I have seen divorcing homeowner's loss money because of stubbornness and anger and a few couples file Bankruptcy. Many times the extra hardship could have been avoided.
When You Buy Your Next Home
Use the … (0 comments)
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education: Divorce and Real Estate Options - 06/27/07 05:45 PM
You have four basic housing options when in the midst of a divorce:
1. Sell the house now and divide the proceeds.
2. Buy out your spouse.
3. Have your spouse buy you out.
4. Retain your ownership.
It is important for you to understand the financial implications of each of these scenarios.
1. Sell the House now and divide the Proceeds
Your primary consideration under these circumstances is to maximize your home's selling price. We can help you avoid the common mistakes most homeowners make which compromise this outcome. As you work to get your financial affairs in order, make sure … (0 comments)
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education: Divorce and Real Estate - 06/27/07 05:33 PM
Divorce is a tough situation which opens up many emotional and financial issues to be solved. One of the most important decisions is what to do about the house.
In the midst of the heavy emotional and financial turmoil, what you need most is some non-emotional, straightforward, specific answers. Once you know how a divorce affects your home, your mortgage and taxes, critical decisions are easier. Neutral, third party information can help you make logical, rather than emotional decisions.
Probably the first decision is whether you want to continue to living in the house. Will the familiar surroundings bring you … (0 comments)
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education: Home Warranties for Buyers and Sellers - 06/26/07 07:04 PM
Home Warranties
Many home purchasers erroneously assume that the Seller is always somehow liable when there is a defect or failure found in the home is cooling, heating, plumbing, and electrical and/or appliances after the Buyer moves in. Unless otherwise provided for in the contract however, risk of loss often falls on the Buyer. Even where the contract provides that heating, plumbing, pool & equipment, electrical, etc. be "operative" on or until date of possession, disputes can always arise as to when the breakdown occurred, who is responsible, how the repairs are to be funded, and when repair are to be … (0 comments)
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education: Should I be a Homeowner part2 - 06/20/07 09:20 AM
Part 2
Should You Own Your Home? The American Dream Of Home-ownership Isn't Right For Everybody... Or Is It?
Other Considerations:
Maintenance
Buying: Any maintenance must be done and paid for by you. Home maintenance costs average about 1% of your home's value per year.
Renting: You typically are responsible for very little maintenance and maintenance costs when you rent.
Time to Move
Buying: If and when you want to move, you will have to sell your home first.
Renting: Your only concern is fulfilling your lease.
A Place to Call "Home"
Buying: You have the right to remodel and redecorate at your discretion. You own it; you can do … (0 comments)
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education: Should I be a Homeowner - 06/19/07 05:16 PM
Part 1
Should You Own Your Home? The American Dream Of Home-ownership Isn't Right For Everybody... Or Is It?
Weighing the pluses and minuses of home-ownership...Buying a home can be one of life's most exciting and yet most challenging experiences.
With the numerous loan programs available to consumers today, it is easier than ever to get into a house. However, the question remains, "Should you own your own home or rent?"
There are many benefits to owning a home, but there are also just as many tradeoffs. To help you decide if owning a home is right for you, we've listed the pros … (2 comments)
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education: REAL ESTATE TERMS - 06/07/07 11:16 AM
Real estate and Mortgage Terms
Earnest Money
Money given by a buyer to a seller as a deposit to commit the buyer to the future transaction. Earnest money is subtracted from closing costs. We also called this good faith money and some areas people may just put down a dollar. A good rule of thumb may be one half to one percent of the purchase price. The monies go toward the purchase of the home
Closing
Also referred to as settlement. The meeting at the conclusion of a real estate sale in which the property and funds are exchanged between the two parties involved. … (0 comments)
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education: Real Estate and Mortgage terms - 06/06/07 08:29 PM
Real Estate Language
Here are some terms that a Buyer and Seller may find useful. This is aimed mostly toward first time buyers. I know when I purchased my first home, I was terrified.Understanding terms can help ease your anxieties. Soak in all you can so that you may become comfortable with your real estate purchase.
Loan-to-Value Ratio
The ratio between the amount of the mortgage loan and the appraised value of the property.
Assumption
An agreement between buyer and seller in which the buyer assumes responsibility for the seller's existing mortgage. This does not happen as much as it use to, at least here in … (0 comments)
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education: Buying a Home - 06/05/07 02:06 PM
We have recently started running Home Buyer Seminars and I am often asked, what do I need to do to purchase a home? Here is a brief guideline that you may follow to buy a home.
How the Buying Process Works
•· Contact lender to get a Pre-Approved loan-please note the difference between getting pre-qualified VS getting pre-approved. A pre-qualification is merely a lender telling you how much your note would be based on how much you make VS how much you owe monthly. It is very import to having a smooth transaction to have a completely approved loan except for a purchase agreement, … (0 comments)
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education: Home Buyers Seminar Held in Columbia Maryland - 05/30/07 04:02 PM
First Time Home Buyers Seminar
*New to the Seminar. Discussion of 100% and 103% percent loans.
You are invited to attend a Free Home Buyers Seminar
Wednesday, June 20th 2007
From 7:00pm to 8:00pm at the Keller William's office
Located at 6350 Steven Forest Road, Ste 107. Columbia, Md. 21046
This Step by Step Introductory First Time Home Buyers Seminar Will Show Potential Home Buyers How To:
•· Take Advantage of record-high foreclosures & record interest rates.
•· Take advantage of special government sponsored 1st Time Buyers programs.
•· Buy now with as little as $3,000 down!
•· Speak to credit specialists that can correct and/ or clean up credit.
•· … (0 comments)
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education: The 60 Minute Bashing - 05/15/07 06:28 PM
The 60 Minutes segment which aired on Sunday evening (speaking about the real estate industry), was sad. Many of the statements were false and inaccurate. Now we will have many more misinformed sellers and buyers to educate. NAR's Rebuttal
A few important truths, many were left out:
1. Commissions are negotiable.
2. The discount brokers want there money up front. So they are paid whether the home is sold or not.
3. Realtors most often work with multiple sellers and buyers and out of say ten clients; three may purchase or list a home. The others that do not sell or buy, we chalk up … (9 comments)
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